The Q&A was conducted with City Developments Limited
1. Why did you use this particular Islamic structure? What other structures were considered?
The CDL SG$1 billion (US$712.5 million) Islamic Trust Certificate Program has the flexibility of raising funds through the various Shariah financing principles. The SG$50 million (US$35.6 million) Trust Certificate issued on the 11th May 2010 is the third series based on the Shariah financing principle of Ijarah. Being a major landlord of properties in Singapore, the Ijarah structure is an appropriate choice.
2. What will this capital be used for?
The funds raised under Series 3 shall be deployed to meet the Shariah compliant working capital of CDL.
3. What were the challenges faced and how were they resolved?
Series 3 was successfully issued on the back of a vibrant domestic credit market and the company’s favorable FY2009 results announcement, hence there were relatively little challenges faced by the company or the lead manager during the issuance process.
4. Geographically speaking, where did the investors come from?
The investors were onshore investors.
5. Was the deal rated? If not, explain why.
The deal was not rated. CDL is also not rated but this has not posed any issue for the company to achieve competitive levels for this Sukuk issuance given that the company is a public listed company that adheres to a high standard of corporate governance and transparency that has made CDL well known in the regional capital markets. |